Dividends as Revenue

Updated Sept. 19, 2003 12:01 a.m. ET

Your Sept. 15 editorial "The Dividend Experiment" lauded the recent cut in the dividend tax rate and the resulting increase in dividends by more than 1,000 companies since the beginning of the year. Although shareholders can achieve essentially the same effect as a dividend by selling shares of stock, you point out that this is too troublesome and expensive to be a practical way for small shareholders to raise cash.

There also is a psychological barrier to achieving dividend equivalence in this way, regardless of...